Chinese solar stocks began to recover last year, and 2014 should lead to strong earnings for the best companies. Trina Solar (NYSE:TSL) and Yingli Green Energy (NYSE:YGE) have already said margins will be higher than expected in the first quarter, something we should expect across the industry.
The other factor helping Chinese solar is a transition to building projects, which is why Canadian Solar (NASDAQ:CSIQ) outperformed its rivals last year. Projects allow companies to generate much higher revenue while maintaining margins, which leads to higher profits. Look for that strategy to expand this year.
In the following video, solar specialist Travis Hoium covers why he thinks Chinese solar companies will have a great year in 2014.
Travis Hoium and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.